Nearly 100 Chinese Tech Startups Hit Unicorn Status In 2018

China’s startup market had a good year in 2018, with close to 100 technology companies garnering a valuation of more than $1 billion.

Known as unicorns, the companies were led by eCommerce and video streaming services, the Financial Times reported, citing data from Hurun’s ranking of China’s top tech companies. According to the report, Hurun, which also produces the annual rich list for China, found there are 186 Chinese tech startups that have valuations of more than $1 billion. In first place is Ant Financial, the digital payments affiliate of Alibaba. Among the video streaming startups, the Financial Times said ByteDance made the list. It runs the Toutiao news video and short video streaming company Douyin. ByteDance, Tencent-backed short-video app Kuaishou, and Meicai, an online platform for farmers selling vegetables, were ranked the fastest-growing startups, with valuations that jumped 400 percent in 2018, reported the Financial Times. The report noted that internet services, medical and health companies, and education were the fastest growing sectors from a valuation perspective.

While Chinese tech companies enjoyed a strong year in terms of investments, the paper did note that there was a sharp decline in the fourth quarter of the year. Only 11 companies raised enough money to push their valuation to unicorn status. That compares to 86 during the earlier three quarters. Hurun also found that in 2018 there were 24 Chinese tech initial public offerings (IPOs) but that investors appear to be souring on IPOs because of their weak performance. Only a few of 2018’s IPOs in the tech sector stayed above their IPO price at the end of the year.

“We’ve had a remarkable boom in unicorns [companies worth more than $1bn] over the past year, no question,” said Hurun Founder Rupert Hoogewerf in the Financial Times report. “But clearly, to find a new unicorn every four days is just unsustainable. No country in the world is doing that.” Huran was forced in the last quarter of 2018 to cut six to eight companies from the list. One to get axed was ofo, the bike-sharing startup that is now facing bankruptcy, noted the report.

Among the investors of these tech startups, the Financial Times reported Sequoia was in the lead with 49 investments in 2018. Tencent invested in 30 in 2018 and Alibaba invested in 17, according to the report.